South Carolina CHE votes no on Coastal Carolina’s latest stadium expansion proposal

Coastal Carolina University made its latest attempt at securing phase two state approval for its football stadium expansion project Thursday, returning before the South Carolina Commission on Higher Education with a 21-percent reduction to its budget and a lesser request for bonding.

It still wasn’t enough.

CHE commissioners voted 9-4 against Coastal Carolina’s project, meaning the school will have to try again – perhaps as soon as next month – and further stall the expansion of Brooks Stadium that is essential for the Chanticleers’ announced move to the Sun Belt Conference and NCAA’s Football Bowl Subdivision.

The university had lowered its budget for the project from $38 million to $29.9 million and had earlier in the day secured approval from its board of trustees to use renovation reserve funds to help further lessen the amount of money that would need to be acquired through bonds by up to $5 million.

The CHE, in turn, continued to express concerns over the lack of upfront private contributions toward the project, and CHE chairman Tim Hofferth continued to express his opinion that Coastal Carolina’s financial projections do not thoroughly anticipate the cost of making this move to the FBS and Sun Belt. This was the fourth time since February the university has brought the stadium proposal to the CHE for needed approval.

“We take the responsibility very seriously. This is not an easy decision. We champion everything that you’re about as an institution,” Hofferth said. “ ... At the end of the day, I’ve talked to a lot of athletic directors, a lot of presidents throughout the country, to bring it without significant private funding in today’s environment [is risky]. The question is what’s significant? I don’t know. There’s 13 [different] significant answers here. The fact of the matter is it’s very relevant and the thing that I’m afraid of, the costs on the operating side are nowhere near what you anticipate them to be. ...

“That’s my greatest concern in this environment. I want to get there. I’m just not there yet.”

Coastal Carolina received supportive votes from commissioners Louis Lynn of Columbia, Bettie Rose Horne of Greenwood, Charles Munns of Aiken and university alumnus Clark Parker of Myrtle Beach, with Munns and Parker in particular making strong comments on behalf of the project.

That wasn’t enough, though, leaving the Coastal Carolina contingent clearly exasperated while becoming something of an example for a recalibrated CHE.

Hofferth told The Sun News in a recent interview that before October, when he took over as chairman, the CHE had never turned down any capital project brought to it for approval and that the commission has changed its approach – as it is making very clear in this particular matter.

After Thursday’s vote, Coastal Carolina president David DeCenzo made a request to the commission.

“I would ask if it’s within a point of order, can we get some very specific direction as to what is going to be a comfort level for those that are on the commission?” DeCenzo said. “You probably can’t do it right now, but I respectfully request that something be given to us because I know there have been some comments at times of ‘Well, why is this new?’ We’ve been playing this ‘Guess what’s on our mind?’ as we get some feedback saying, ‘Well, you’re going to have to lower this, you’re going to have to do that.’ We need some very specific direction. As our definition of private money, if that’s unacceptable to you, if your definition of private money is this is a donor writing a check, is it 20 percent, is it 25 percent? Give us some guideline.”

DeCenzo had introduced Coastal Carolina’s revised budget plan while opening with a statement acknowledging the important role of the CHE and the university’s understanding it had to make revisions to its initial $38 million budget, of which $36 million would have come from bonds, $2 million would come from the Chanticleer Athletic Foundation after completion of the construction and the CAF would commit $500,000 a year along with $200,000 annually in athletic department revenue to pay off the bonds over 25 years.

On Thursday, Coastal Carolina pitched a revision for the budget not to exceed $29.9 million with no more than $27.9 million coming from bonds, but also an option for the bonding portion of the funding to be as low as $22.9 million after use of the renovation reserve funds approved by the board of trustees’ executive committee earlier in the day.

The committee met for about 20 minutes Thursday in the middle of CCU’s board of trustees meeting.

Renovation reserve funds are used for some larger maintenance and campus repair projects, new construction or renovation projects, according to college staff.

Officials use $150 of student tuition per semester for those reserve funds, which is 2.8 percent of in-state tuition per semester, according to information from the finance office.

The university’s revised proposal also included a signed letter from the Coastal Educational Foundation pledging to cover any shortcomings in the CAF’s annual $500,000 contributions if needed, as an extra layer of security the school hoped would ease doubts or concerns about the funding streams.

In his opening address to the CHE later in the day, DeCenzo outlined the university’s new budget proposal.

“Yes, our world is changing. The old models of surviving no longer exist. We adapt or we cease to exist. I know that means your jobs as commissioners have changed too. What was once a rubber stamp can no longer be the way business is done, and while Coastal has taken the lead on many things I sure wish we weren’t the first ones to go through this necessary level of project scrutiny,” DeCenzo said. “While I applaud your efforts, please know that this is new for us too, and yes, it has taught us some lessons. So the question I have is how do we move this forward?

“We have heard from you loud and clear that $38 million is not going to fly, period. So here’s what I challenged my staff to do, eliminate all parts of the stadium expansion that are not absolutely critical to meeting our obligations to state building codes, the NCAA or the Sun Belt Conference.”

Those revisions included reducing the projected total number of seats from around 22,000 to 19,000, removing planned facades and plazas, removing the boardwalk that would have connected the open end of the stadium and also removing the enhanced sound system, the deck slab at the club level and all kitchen equipment.

The Chants’ football program is set to debut in the Sun Belt in 2017 and the NCAA requires FBS schools to maintain an average attendance of 15,000, which is not possible within the current 9,214-seat Brooks Stadium.

“We did make the commitment to the Sun Belt Conference, which requires the stadium expansion. Our failure to meet that commitment could result in a number of things, the first being the negative media coverage that will hurt Coastal Carolina University for years,” DeCenzo continued in his opening address. “We have contracts with power-five schools which will pay us over $1 million per game; without being FBS we will never see that money, and worse yet we may have to break those contracts, which would result in a financial liability to us.

“But most importantly are the 25 recruits that we signed this year, eight of whom are from South Carolina. They start Coastal in the fall. Our failure to move this project along means our inability to meet NCAA requirements is in jeopardy, as would be our FBS standing. As a result we’d have to tell those 25 athletes that we cannot afford them the full scholarship they were promised when they signed with Coastal Carolina University. That to me would be the biggest tragedy of all.”

The Chants are not quite to that point yet, but the longer this process drags on, the tougher it is going to be to stay on any sort of anticipated timeline and the more serious the questions become.

DeCenzo was not available for an interview after the vote went against Coastal Carolina as he and the other university officials were past their expected departure time to make it back to campus for commitments related to the school’s commencement ceremonies this week.

“We’re disappointed, obviously,” he expressed on his way out.